Disagree on N200b subsidy deductionGovt cuts 2012 budget benchmark to $70STATES in Nigeria, which heavily depend on federal allocations to run their bureaucracies and meet other obligations, may have difficulty doing so this month (October). Reason: Representatives of the Federal Government and the states yesterday in Abuja failed to agree on the figures presented to them as revenue generated by the country last month.Consequently, no revenue allocation was distributed to all the beneficiaries from the Federation Account, which has been a monthly ritual. At the crux of the dispute, according to states' finance commissioners was the N200 billion deduction from the revenue by the Federal Government as cost of the controversial subsidy for petroleum products by the Nigerian National Petroleum Corporation (NNPC) and the Petroleum Pricing Regulatory Agency (PPRA).The development, which the states rejected, led to a deadlock at the meeting with no clear idea on when they will reconvene.The acting chairman of states' Finance Commissioners' Forum, Mr. Eze Echesi of Anambra State told reporters after the meeting that the states want the Federal Government to restore the deductions before they could return to the distribution table.This development coincided with the central government's launch of the controversial Sovereign Wealth Fund (SWF), which engaged KPMG as the management team.TheCo-ordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, who announced the progress, said $1 billion of the $6 billion in the defunct Excess Crude Account had been transferred to the SWF pending the conclusion of the ongoing dialogue with the Nigerian Governors' Forum.She said: 'The recruitment of the management team of the fund through a transparent process targeting the best qualified Nigerians within and outside the country has commenced. KPMG has been engaged to manage this process and advertisements calling for applications from interested Nigerians will soon be published in the Economist and the Financial Times.'The President has directed that we put everything into this process because he is committed to ensuring that Nigerians and the economy benefit from the focused implementation of the fund.'We are still talking with the governors and the dialogue is being conducted in an atmosphere of mutual respect because we want both sides to appreciate that at the end of the day, it is all about improving the lot of Nigerians and strengthening the economy,'' she said.The minister also revealed yesterday that the benchmark for the 2012 budget would be reduced from $75 to $70 per barrel of oil to protect the economy from expected volatility.She spoke at this year's accountants' conference of the Institute of Chartered Accountants of Nigeria (ICAN) where she represented President Goodluck Jonathan as special guest.According to her, the decision was arrived at after due consultation with experts and major stakeholders. She advised states to be prudent in their financial resources to maximise value.Earlier in an address, ICAN President, Prof. Francis Ojaide, explained that the theme of the conference: 'The dawn of transformation: Embracing change and seizing opportunities,' was chosen to underscore the need for Nigerians to look beyond the current economic challenges, discern and take advantage of the opportunities embedded in the transformation agenda of the government.'By its very nature, transformation is often followed by temporary pains, discomfort and even disorder, which humans detest. Indeed, history attests to the fact that except people abandon their comfort zones, desire a higher order need, progress will not be achieved easily.
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